This article has been translated from English to Gen Z Slang.
Alright, fam, if we level up this trend line biz and imagine drawing another line that vibes parallel with the uptrend or downtrend angle, boom, we just made a "channel."
Nah fam, we're not talking about ESPN, National Geographic, or Cartoon Network. 🖥️
These channels ain’t squads like those, they’re trend channels, sometimes given a nickname like price channels.
Still, don’t dip like it’s a commercial break. Channels can be as juicy to peep as Stranger Things or as wild as Keeping Up with the Kardashians!Trend channels are just another trick in the technical analysis toolkit, helping you spot those lit buy or sell moments.
The upper trend line is like the ceiling (resistance) and the lower line is like the floor (support). So all the tops and bottoms spell out legit spots of support or resistance.
Trend channels with a neg slope (down) are total bear mood and those with a positive slope (up) are all about that bull life.
To make an up (ascending) channel, just sketch a parallel line like a sidekick to the uptrend, moving it so it vibes with the freshest peak. Do this while giving birth to the trend line.
For crafting a down (descending) channel, drop a parallel line matching the downtrend’s groove and adjust it to the latest valley. You want to roll this out while crafting that trend line.
When those prices slide below to the LOWER trend line, it’s like a buy me now alert. 🤑
And when prices pop to the UPPER trend line, consider it the time to toss.💸
Types of Trend Channels
Alright, you’ve got three flavors of channels:
- Ascending channel (them higher highs and higher lows)
- Descending channel (peep those lower highs and lower lows)
- Horizontal channel (just keep it ranging)
Some of y’all might vibing with “rising channel” or “falling channel,” cuz hashtag Millennial style.
Here's the 411 on drawing trend channels:
When plotting a trend channel, make sure each line vibes in parallel, just cruising together.
The bottom is the “grab it zone” while the top is the “drop it zone” in the trend channel life.Like with trend lines, NEVER force the price into the channels you doodle! Just let it chill.
A channel that's got both sides on different wavelengths ain't cool and can totally mess up your trades.
If the lines lose their groove like that, switch up, cuz it's trying to be a trend channel but ends up being a triangle. More about those later.
BTW, trend channels can have some wiggle room; they don't gotta be super parallel or hold every lil’ price play inside.
A rookie move is hunting for textbook price setups only.
That way, you might ghost essential price action details and miss other hot clues.
Check out how these channels align below…
Do they look lit? 👀
Waiting for spotless textbook scenes won’t help in the actual wild, since it's rare to see price action fitting perfectly between two dreamy trend lines.
It’s like hunting for the perfect bae in real life. When you find 'em, hold on tight. 😭